Seniors Housing Census Woes Continue
Brookdale Senior Living is not the only one with some recent census declines… The next few weeks will be very telling in terms of the direction of some of the major seniors housing companies. All eyes will be on Brookdale Senior Living next week as it announces second quarter results and whether it has reversed its downward occupancy trend. Brookdale’s stock price is down about 15% since June 1 and is at its lowest level in more than eight months. Those activist shareholders must be going nuts. We know NIC MAP indicated a tough second quarter in general, and we also know that the Atria Senior Living and Sunrise Senior Living properties in the Ventas stable posted a combined 40 basis... Read More »Assisted Living prices hold steady
After the average price paid for assisted living rose from $150,600 per unit in 2013 to $188,700 per unit 2014, a 25% increase according to the 20th Edition of The Senior Care Acquisition Report, who would have expected that in these heady times in seniors housing, there would be virtually no change in the average price for the last two four-quarter cycles? Indeed, for the 12-months ending March 31, 2015, the average price per unit was $188,900 (up 0.1% from the 2014 Calendar Year), and for the 12-months ending June 30, 2015, the average price per unit was $189,500 (up 0.4% from 2014). Is this evidence enough that we have reached the top of the roller coaster? Or is demand still so strong... Read More »Cambridge completes four HUD transactions
Cambridge Realty Capital Ltd. has had a busy month, underwriting four HUD loans worth over $50 million. All of the loans went towards refinancing skilled nursing facilities for three separate local limited liability companies and an Illinois not-for-profit. The first, an $8.7 million loan with a fully amortizing 30-year term, refinanced a 180-bed skilled nursing facility in Dayton, Ohio. Staying in Dayton, a 148-bed skilled nursing facility received a $14.2 million HUD refinance with a 30-year term. Next, Cambridge arranged a $16.5 million loan with a 32-year term to refinance a 235-bed facility in Elmwood, Illinois that also provides Alzheimer’s and dementia care. Finally, an Illinois... Read More »Location, location, location
In a deal that shows location is absolutely crucial to a community’s desirability, an assisted living community in Santa Monica, California with 22 all-semi-private units and just a 50% occupancy rate sold to an undisclosed buyer for $4.4 million, or $200,000 per unit (nearly $10,000 higher than the average for assisted living for sales in the 12-months ending June 30, 2015). Jim Hazzard and Nick Stahler of JCH Consulting Group handled the transaction. Messrs. Hazzard and Stahler, together with Shep Roylance, also facilitated the sale of a 31-year old assisted living/memory care community with 90 units and 120 beds in Los Angeles County, California to an undisclosed buyer for $23.4... Read More »Financing for the “new-normal”
A health complex in West Hartford that had never fully recovered from the losses in reimbursements and operating income incurred during the Great Recession, and from larger healthcare systems in the area, was faced with a dilemma: how do you deal with this “new normal” of operating and reimbursement parameters while still servicing its debt? Hebrew Home and Hospital, Inc. (HHH) is the not-for-profit owner of a 367-bed health campus in West Hartford, Connecticut, which features 277 skilled nursing beds, 45 beds providing hospital-level services, a 22-bed behavioral health unit and a 23-bed complex medical unit. Originally built in 1987, the project was financed with a HUD loan funded with... Read More »Shovels in the ground for first NFL-alumni community
Validus Group recently received plenty of press for its proposed venture (together with investment bank Piper Jaffray) to develop a $1.1 billion dollar pipeline of 33 new assisted living/memory care communities geared towards former NFL players. With over 18,000 former NFL alumni in the country and nearly one-third of them likely to develop some memory impairment, that’s a healthy chunk of the NFL population who may need Alzheimer’s or dementia care. Validus’ plan is to open a community in cities with high concentrations of NFL alumni. While some cities will certainly have higher concentrations of NFL alumni than others, if just a couple of former players move into one of these communities... Read More »Two-property transaction
A private investor group recently sold their 217-unit CCRC in Fayetteville, Pennsylvania, with a separate 70-unit assisted living community in Maytown, Pennsylvania, to a large publicly traded REIT for an undisclosed price. The CCRC, which consists of 13 independent living cottages, 112 independent/assisted living and memory care units and 92 skilled nursing beds, was constructed in stages from 1977 to 2014 and includes both entrance-fee and rental residents. Occupancy there stood at around 88%. The previous owners were mulling plans to construct a 168-unit independent living building on the sprawling 100+-acre property. Meanwhile, the assisted living community, built in 1999 and expanded... Read More »SNF M&A; A Market Remains Robust
With at least five transactions priced over $100,000 per bed so far this month, July may be a record for high-priced SNF sales. The skilled nursing facility M&A market continues to lead the way in terms of where the post-acute sector may be heading. So far in the past three weeks, we have seen five deals close with values ranging from just over $100,000 per bed to over $200,000 per bed. Yes, a few have been in the northeast, which can be expected, but these high-priced sales go all the way from North Carolina to Texas to California. This is not a regional phenomenon. It is a change that is going on in the sector that will be part of the evolution of who takes care of the elderly, how... Read More »Upper East Side SNF sells big
It’s not often you see a skilled nursing facility sell for north of $200,000 per bed. But not all facilities are located in the heart of the highly desirable, high-income Upper East Side in New York. Well, a group of private investors, known as 79th Street Acquisition Group LLC on city records, and Cassena Care, which operates seven SNFs in New York City and Connecticut, purchased a 499-bed SNF for $105.5 million, or $211,400 per bed. The 170,000-square foot facility sold for approximately $621 per square foot, and with its tremendous location, is seen as a potential development site. Built in 1967, the facility had been operated by Marilyn Lichtman since its opening, including when she... Read More »How are SNFs managing costs?
With all the talk of rising acuity in skilled nursing, how are operators going to manage the resulting rise in revenues and, of course, costs? Based on SNF sales in 2014 (according to The Senior Care Acquisition Report), the average expense ratio has fallen to a five-year low of 88.2%, or 50 basis points lower than in 2013. With this significant fall coming in tandem with the rise in average price per bed paid for SNF acquisitions in 2014, it is clear that buyers will pay a premium for a facility that better manages its expenses, especially in this higher acuity, higher cost market. Read More »Schedule a demo
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